Unfavourable economic conditions among Canada's main trading partners will cause exports to decline.
New York, NY (PRWEB) May 06, 2014
Operators in the Shoe and Footwear Manufacturing industry have suffered as a result of adverse market conditions during the five years to 2014. Rising input costs, slow growth in per capita disposable income, inflationary pressures, an appreciating dollar and intense competition from cheap imports have played a decisive role in this industry's decline. During the five years to 2014, increases in the prices of rubber, leather and synthetic fibre and an uncompetitive cost structure due to high labour and utility costs have provided little impetus for Canadians to purchase domestically manufactured footwear. The consumer price index has increased during the past five years, while per capita disposable income has slowly risen during the same period, thereby causing discretionary purchases to decline. Consequently, industry revenue is expected to fall at an average annual rate million during the five years to 2014, including an anticipated decline in 2014.
However, the decline of the Shoe and Footwear Manufacturing industry is not a recent phenomenon, as it has been steadily declining for most of the past two decades. During the past five years, according to IBISWorld Industry Analyst Zeeshan Haider, “the industry was particularly hurt by the global recession, especially the unfavourable economic conditions in the United States and the appreciation of the Canadian dollar.” The United States is the largest importer of shoes from Canada and the Canadian dollar appreciated between 2009 and 2014, against the US dollar. Consequently, “US imports from Canada dramatically declined during the five years to 2014, while overall exports declined at an annualized rate during the same period, severely hurting industry revenue,” says Haider.
Market share concentration in the Shoe and Footwear Manufacturing industry is low. IBISWorld does not expect this industry's fortunes to significantly change during the next five years. Revenue declines are expected to be far less severe during the next five years as a result of less room available for foreign competition. A decline in the Canadian-dollar effective exchange rate will also benefit the industry; however, it will not be enough to reverse overwhelming trends indicative of this industry's decline. Overall, IBISWorld expects industry revenue to decline at an annualized rate during the five years to 2019, with an expected to decline in 2015.
For more information, visit IBISWorld’s Shoe & Footwear Manufacturing in Canada industry report page.
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IBISWorld industry Report Key Topics
The Shoe & Footwear Manufacturing industry manufactures footwear for men, women and children. Orthopedic footwear and specialist athletic footwear, such as skates or roller blades, are not included in this industry.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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